Originally the Democrats in Congress made it seem like the government was going to be in charge of student loans and take that responsibility from the current private lenders. Obama had planned to do this as a way to give more loans to students and to take away the profits from the private lenders.
Some colleges were taking the initiative and getting loans from the government, seeing as they had thought government ran student lending was going to be the future of student loans. Obama's main goal in passing this bill was to make college more affordable.
Now, though, the future of this potential bill looks grim. Private student lenders, especially the largest one with $22 billion worth of loans set last year, Sallie Mae, have started fighting back, and have been getting aggressive in doing so with their lobbying campaign. They are standing up and fighting against the government by doing meetings to persuade people that their side is the right way to go.
Also they have been getting petitions signed, looking for thousands of signatures in support of their case. Senators, who of course represent their states, may reconsider the bills if the citizens in their states disagree with it, and that is what the loaning companies are trying to exploit. They hope that they can end up putting the government back a few steps in doing so.
And indeed that is exactly what it is doing. In the fall the bill's possibility of passing seemed likely, however now it is uncertain. Both the House of Representatives and the Senate claim that the difficulty in passing this bill has increased. Having the government run student lending could either hurt or help student, and the current lenders and Obama administration have different views on the subject.
Promises of expanding educational programs and having more grants are coming from Obama's staff, where as the large student lending companies are claiming that students will only default on their loans more.
Another strategy that the current businesses that focus on loaning are doing is claiming that the government is only trying to do a takeover, and will put many of the people who work in those businesses out of jobs. The student lending companies currently have around thirty-five thousand employees. It is debatable as to how many of those people will actually lose their jobs if the government were to in fact take over student loaning.
A common question that is being brought up, especially by people who deal with financial aid in colleges, is to whether the approach that the government is taking, where loans are more limited to more people could possibly hurt the students and colleges. This, however, has not stopped schools from using government lending programs. And of course, there are always people who are concerned about the possibility of an unnecessary government take over.
A lot of questions are being thrown around about this issue. The future of student loaning all depends on who can advertise their case better and gain more support. The battle has increased majorly since Fall, and it is a continuous struggle for each side.
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It's recommended that students apply for financial aid and Direct Loans before considering a private Education loan through a lender. Information on Direct Loans and Private Loans may be found on GRCC's website on the Financial Aid page.